India and Pakistan must use the strong peace sentiment on both sides of the border to develop better trade ties

The India-Pakistan relationship is a complex one, dominated by excessively polarised discourse. Over the past decade or so, one point has become evident. First, strong constituencies for peace between both countries have emerged along the border regions, be they Rajasthan-Sind or the two Punjabs. The enthusiasm with which people responded to Confidence Building Measures (CBMs), such as the Munabao-Khokhrapar train service and bus services connecting Delhi and Lahore and Amritsar-Lahore, are a reiteration of this point. It is a different matter, of course, that logistics issues have prevented both these initiatives from being a success.While in the case of the Punjab, opening up trade at the Wagah-Attari route and setting up the Integrated Check Post have got businessmen on both sides of the Radcliffe Line interested, some logistics issues persist. There is also a desire to open the Hussainiwala (Ferozepur)-Ganda Singh route, which was active before the 1971 war. This will be relevant especially in the context of the potential for petroleum trade between both countries, since the Bhatinda oil refinery, inaugurated in April 2012 by the Indian Prime Minister, is only 100 km from Hussainiwala. With the politics of Punjab being dominated by the Malwa belt, and the current Deputy Chief Minister, Sukhbir Singh Badal, being an MLA from Ferozepur, support for opening up this route is only likely to increase. The leather industry, which contributes 5.4 per cent of overall export earnings, will also benefit from the same trade route as Kasur city, adjacent to Ganda Singh and 60 km from Lahore, is a hub of tanneries in Punjab.Makes business, political sense

In Rajasthan-Sind, while the train service is chugging along, trade through the Munabao-Khokhrapar route is yet to open, though there is strong support for it. This route too could come in handy for petroleum trade, since gas has been discovered at Barmer.

Opening up these two borders would make sense from the business point of view, and come in handy politically for a number of reasons. North India will benefit more through land trade vis-à-vis Pakistan.

Currently, trade is only allowed through the Wagah-Attari land route; other road links are ignored. Barki road connecting Lahore-Patti, the Kasur-Firozpur roads at the Ganda Singh border, the Sahiwal/Pakpattan road link with Fazlika, Head Sulemanki and Multan borders, have the potential to enhance Punjab-to-Punjab trade manifold.

In the Pakistan context, Ganda Singh strengthens the pro-trade constituency in Punjab. In fact recently a delegation from Indian Punjab met Prime Minister Nawaz Sharif, who was enthusiastic about the idea. Apart from this, opening up the Raj-Sind border would assuage feelings in Sind, especially for those who believe Punjab will benefit from India-Pakistan trade while other States will be left behind.

If one were to look from the Indian side, opening more routes is important since this will help create a stronger political consensus for better ties. While Punjab is already ruled by the Shiromani Akali Dal, an ally of the Bharatiya Janata Party (BJP), Rajasthan too could get a BJP government in the aftermath of the December Assembly elections. In addition to this, by opening up the Rajasthan-Sind border, businessmen from neighbouring States such as Madhya Pradesh and Gujarat which are BJP-dominated would also benefit. Currently, traders from Madhya Pradesh have to go all the way to the Wagah route.

Existing as well as new markets have the potential to achieve the highest targets. The existing market, worth $13 billion, comprises smuggling and personal baggage. Therefore, the legalisation of trade would help the government of Pakistan earn revenue in the form of import duties. The key to the economic success of a country is promoting regional trade. However, Pakistan’s regional trade is less than five per cent of the total. Millions of dollars can be earned if more trade routes are opened.

Land over sea

A study carried out in 2006 estimated that over 80 per cent of firms are forced to trade through the Karachi-Mumbai sea route, even if they are located in the border station of Amritsar. Similarly, the Sind-Rajasthan border can connect Rajasthan and Gujarat with Sind, which has huge potential to enhance trade between both countries by the land route. The Munabao-Khokhrapar rail route can lessen the burden on the Karachi-Mumbai sea route, which is the most common, formal trade route between India and Pakistan. It will also save time and money as the sea route requires cargo ships to touch a third-country port before bringing in goods.

The Pakistan Army, being a strong and influential stakeholder, can be brought into the loop as it has a vested interest in the economic structure. This way, India-Pakistan business and people-to-people contact may be enhanced, and stringent visa policies may get relaxed.

(Tridivesh Singh Maini is a New Delhi-based columnist, and Usman Shahid, a Lahore-based journalist and researcher.  )

Source-http://www.thehindu.com